GoDaddy.com, a manager of Internet real estate, is perhaps most famous for a pair of racy Super Bowl spots; aside from that, the average consumer--not to mention the average investor--probably has no
idea what the company does. Now that GoDaddy has reportedly hired Lehman Brothers to conduct an IPO, it's become the company's business to give everyone a better idea about Internet real estate.
GoDaddy is essentially a middleman between individuals who want an Internet address and VeriSign, the company in charge of maintaining over 13 million Internet addresses, or 20 percent of the
registered domain names on the Web. VeriSign says its registration is increasing at a 30 percent clip, but it's unclear how much money can be made by a reseller of Internet real estate. Toronto-based
Tocows is the only publicly traded company with a similar business model; it made $2.8 million on sales of 48.5 million last year, but its shares have been flat, at around $1, for a few years.
"Domain registration is not the most attractive business to be in today, but it does fulfill a need," says the chairman of one small domain registration firm. Aside from some clever marketing, there's
not much a company like GoDaddy can do to differentiate itself from its many competitors, says Forbes.com; many collaborate with clients to sell Google AdWords on otherwise empty domains, so both
companies can earn a profit without publishing any material. Not surprisingly, some analysts think this is a little sleazy.
Read the whole story at Forbes.com »
